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Jun 30, 2023
Unity Q2 2023 Earnings Report
Unity had a strong second quarter, with revenue and adjusted EBITDA exceeding guidance, also increasing the low-end of the revenue guide by $40 million.
Key Takeaways
Unity's Q2 2023 results showed strong performance with revenue of $533 million, representing 80% year-over-year growth. The company's GAAP net loss was $193 million, while adjusted EBITDA reached $99 million. Free cash flow for the quarter was $33 million, and adjusted EBITDA margins reached 18.5%.
Revenue of $533 million, an increase of 80% year-over-year.
GAAP net loss was $193 million and adjusted EBITDA was $99 million, an improvement of $136 million year-over-year.
Free cash flow for the quarter was $33 million, which is reduced by one-time payments related to restructuring.
Adjusted EBITDA margins of 18.5%, which compares to 6.5% in the first quarter of this year and negative 12.7% in the second quarter of the prior year.
Unity
Unity
Unity Revenue by Segment
Revenue by Segment
Create Solutions Revenue
CapyFin.comGrow Solutions Revenue
CapyFin.com Forward Guidance
For the third quarter, Unity is guiding revenue of $540 to $550 million and adjusted EBITDA to $90 to $100 million. For the year, Unity is increasing the low-end of the revenue guide by $40 million to $2,120 - $2,200 million and guiding adjusted EBITDA to $320 to $340 million.
Positive Outlook
- Assuming that the game ads market will be relatively flat throughout the balance of the year, other than normal seasonality.
- Assuming a continuation of a soft market in China.
- Assuming additional planned deceleration in Professional Services.
- Expect 477 million of fully diluted shares at the end of the third quarter and 488 million at the end of the fiscal year.
- Continue to be committed to reach $1 billion adjusted EBITDA run-rate by the end of 2024.
Challenges Ahead
- Ongoing uncertain economic environment.
- Game ads market will be relatively flat throughout the balance of the year, other than normal seasonality.
- Continuation of a soft market in China.
- Additional planned deceleration in Professional Services.
- These estimates do not include the impact of any future repurchases that we may choose to make under our previously announced stock repurchase program.
Revenue & Expenses
Visualization of income flow from segment revenue to net income